Extended warranty coverage can be an extremely beneficial and necessary safety net if and when you choose to buy a vehicle. Vehicle repairs are expensive, and often times, the most expensive repairs happen after the car has gone through its initial warranty period. Because of this, many people choose to take out extended warranty coverage with third party companies.
While there are many benefits to having an extended warranty on your car, and most claims are covered, there are certain instances were claims are denied. There are a myriad of different reasons claims may be denied by the insurance company. If your claim has been denied, don’t get worried just yet. While stressful, many times you can work with the warranty company, and have the original decision overturned, leading to coverage of your claim. We’ve collected a few important tips and tricks that you should know before going head-to-head with an insurance company over a denied claim.
What Do I do if a Claim is Denied?
If you are in a situation where a claim has already been denied, don’t worry just yet. There are several steps you can take to work with the extended warranty company to change the ruling:
- First and foremost, you’ll need to get the ruling information in writing, and speak with the claims adjustor who came out to look at the job. You’ll want to have as much detail as possible when you go to appeal the decision, and having written information from the claims adjustor will help you move forward.
- After you have the reason for the denial, you’ll want to speak with the service provider. When you talk to a service provider, you’ll want to find out whether or not they agree with the adjustors assessment. For example, an engine claim may be denied because the adjustor does not believe the problem was caused by a covered component. This is not an uncommon situation, and often times, people find their claims have been denied for this very reason. If your service repairman does not believe the malfunction was caused by the reasons outlined in the decision, ask him to place it in writing, or to speak directly with the claims adjustor.
- In most cases, you’ll need to pay the bill for the repairs, and get reimbursed directly from the warranty company, in the case of a denied claim that goes to appeal. After you’ve received a denial letter, you’ll need to speak with the company about their protocol for an appeal. Some companies will require a written appeal, while others will take a phone appeal. A written appeal, however, tends to have a better track record of being accepted. Write an appeal explaining the denial, and why you believe the claim should be covered. Include any and all evidence you have, including information from the service provider. Send in the claim and wait for a final decision.
Has Your Auto Warranty Expired?
How Do I Prevent Claims from Being Denied?
Sometimes, the easiest way to prevent a claim denial, is to know what your policy covers and what it does not cover. When you have this information you can more accurately predict what kind of service will be covered by the company, and what services will not be covered by the company. Before you sign up with a company you should go through the policy in detail. If you don’t understand the policy, feel free to take it to a person who has knowledge of such warranties and have them read over it. Understanding what the policy covers and does not cover is an important first step in prevent claim denials.
When you are going over your policy options, ensure that the extended warranty coverage you are buying covers wear and tear. Many people find themselves with claim denials when the policy does not cover wear and tear issues. Many mechanical issues can be attributed to wear and tear, and many claims will be denied on this basis. Having a policy that covers wear and tear will make it easier for you to have a claim accepted when and if you need mechanical repairs. Ask the insurance provider if wear and tear is covered, but also check to see what the limitations on that coverage may be. Most riders will have some limitations, so knowing those limitations are important.
Once you agree to the policy and pay for it, you should check with the company for a list of approved service shops. Sometimes, a warranty company will work directly with a group of service providers. While most insurance companies will take claims out of any repair shop, the entire process tends to be smoother when using a service provider that the company has worked with in the past, or considers a trusted repair shop. You should also check the ins and outs of such coverage, and ask whether or not claims at any service provider can be submitted, or if you must use one of the service providers the company works with.
Has Your Auto Warranty Expired?
How Do I Find the Best Extended Warranty Coverage?
While most extended warranty companies are on the up-and-up, there are unscrupulous companies floating around. These companies will over extended warranty policies, however, their track record of accepting claims are spotty, if not abysmal.
- The best way to prevent dealing with a problematic company, is to do your research before you agree to the coverage policy. Before you purchase an extended warranty do your research. The easiest way to do this is to take to the internet. Often times, people will write about poor service and difficult companies, and a quick search of the companies name will often yield results. Don’t be alarmed if you don’t find much on the company. Most times, people will only write when they have a poor experience, rather than a good one. You want to look for a company that does not have a ton of negatives being said about them. If you find a company that has a handful of positive reviews but many negative ones, you’ll want to move on. You are looking for a warranty company that has the least negative writings about them.
- Talk to your car repair service provider. Many times, these professionals have intimate knowledge of extended warranty companies. After all, they work with them day in and day out. A service provider can usually point you in the direction of honest affordable extended warranty companies, and help you avoid those who are less than stellar in their track record. Ask for their opinions, but do take the company names they’ve provided and do further research.
- Before agreeing to coverage, do speak with the company and discuss the policy in depth. You'll want a policy that covers a wide array of problems and mechanical failures, and the only true way to know what is covered is to simply ask the question. An extended warranty company should be happy to answer any and all of your questions related to the policy. A company who is unwilling to answer your questions, likely isn't going to be helpful in providing service after the fact, either.
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